It's 2021. Welcome to yet another "year of 5G."
This year is the fifth "year of 5G," at least by my count. However, 2021 is certainly positioned to be the most interesting yet.
Well, first and most importantly, 2021 will always be remembered as the year when US wireless operators collectively spent almost $100 billion (including clearing costs) on 5G spectrum licenses in the C-band. Incredibly, that figure doesn't even include the billions of additional dollars that will be required for things like radios and cell towers necessary to turn those spectrum licenses into actual, commercial services.
An auction for the ages
Beyond those mechanics, though, the astounding, eye-watering figures being thrown at C-band spectrum reflects a deep belief among US operators that, yes, there's something behind this whole 5G thing. (It's also likely a reflection of historically low interest rates, but that's not the point.) The C-band auction is important because, so far, US operators by and large are not charging extra for 5G services, at least on smartphones. This situation has erased a clear path to a 5G return on investment, but it doesn't eliminate it altogether.
Instead, the incredible amount of money raised by the FCC's C-band auction shows that US network operators aren't just paying lip service to the "fourth industrial revolution" made possible by 5G. They're willing to put their money where their marketing is, and that's an important development for the rest of the industry's players who may have been worrying that 5G is just 4G on steroids.
To be clear, 5G networks running in C-band spectrum likely won't be online until the end of 2021 at the earliest. In fact, more than half of the spectrum up for grabs in the auction won't be accessible until 2023, when incumbent satellite users move their operations elsewhere.
Nonetheless, speedy 5G networks powered by C-band spectrum winners are coming. (The FCC will likely identify those winners by early March.) And, based on the capabilities supported by midband 5G networks elsewhere in the world, 5G networks in the US working on C-band spectrum may finally support the kind of "transformative" experiences that 5G proponents have been promising for the past five years.
A finish line in the race to 5G?
But the C-band isn't the only reason 2021 ought to be especially interesting for those in the 5G industry in the US. Joe Biden's victory over Donald Trump could set the stage for a dramatic reset when it comes to relations between the US and China, and that could have profound ramifications for 5G.
After all, Trump made the "race to 5G" between the US and China a centerpiece of his telecommunications policy. The notion helped to drive FCC regulators to squash local network-buildout rules in favor of speedier guidelines developed at the federal level. And it also helped to focus a government-wide campaign against China's Huawei that culminated in the US State Department's "clean networks" campaign that forces global network operators to pick a side in the debate.
Incredibly, it's not clear how a President Biden will handle relations with China, despite a seemingly endless election cycle in 2020. "Biden has occasionally talked tough on China, including when it comes to data security, but his specific policy prescriptions are so few as to fit into a TikTok video," writes Axios's Dan Primack in pointing out that Trump's war against China's TikTok appears to have ended with a whimper. Primack described Trump's economic policy toward China as a "talk loudly and carry a small stick" approach.
If Biden decides to maintain Trump's aggressive posture toward China, the 5G industry may continue on a course that some believe could create a split in the standard between a US version and a Chinese version. Or Biden could look for some kind of technological détente.
Either way, 2021 likely will be the year when this becomes clear.
Clouds gather around 5G
The C-band auction and Biden's Chinese decisions are two external factors that will have major implications for the 5G industry, both in the US and globally. But a third factor sits much closer to home.
The merging of cloud computing and 5G is a slow-moving trend, to be sure, but it's poised to get a lot clearer in 2021.
After all, the telecom strategies of Amazon, Google and Microsoft – three of the biggest tech companies in the world – all crystallized during 2020, particularly following Microsoft's blockbuster acquisitions of Affirmed Networks and Metaswitch Networks.
Google, Amazon and Microsoft have all dabbled in telecom services in the past, but all three in 2021 will be selling comprehensive edge and cloud services to telecom operators. The marriage of 5G, edge and cloud promises to dramatically improve the performance of 5G networks by reducing latency and adding flexibility, but it could also overhaul the design of 5G networks themselves by putting critical network functions inside a public cloud.
How operators respond to the overtures by Microsoft, Google and Amazon will have significant repercussions for every vendor in the telecom space, including heavyweights like Nokia and Ericsson.
5G deployments get boring, services get exciting
The "year of 5G" trend started in 2017 because that's when the technological standard was officially approved. That development paved the way for several "years of 5G" that involved operators turning on commercial 5G services. And of course 2020 featured Apple releasing its first 5G iPhone.
But 2021, according to Verizon, will be a year of 5G applications and services. At least, that's what the operator's CEO said during his big CES keynote appearance this month.
Of course, Verizon isn't the first operator to attempt to focus on 5G "use cases." But what is noteworthy is that Verizon CEO Hans Vestberg used his first CES keynote appearance with the operator, in 2019, to provide a definition of 5G: It's faster, yes, but it can also support lower latency and more IoT devices.
Now, in 2021, Vestberg is shifting the focus away from network metrics and is instead focusing on what firefighters, delivery companies and even regular people can actually do with 5G.
And though widespread 5G drone deliveries might not actually happen in 2021, the notion that the fifth annual "year of 5G" might actually focus on real-world stuff is a welcome development.
At least, it will be until someone figures out that 2021 is actually the "year of 6G."
- Here are nine new things that 5G can do now
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- Monetizing 5G is operators' biggest challenge for 2021 – Omdia